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NDP Leader John Horgan addresses supporters during a campaign rally in Vancouver, B.C., on Sunday April 23, 2017.

DARRYL DYCK/The Canadian Press

B.C.'s New Democrats will not be raising rates for most car owners, or changing the province's unique litigation-based claims model, despite an independent report floating these options as solutions to an impending economic emergency at the Insurance Corporation of British Columbia (ICBC).

Instead, the government plans to charge bad drivers more as well as those with luxury vehicles while studying where else it can achieve efficiencies at the Crown corporation, said Attorney-General David Eby, the minister responsible for ICBC.

An independent report commissioned last year by the Liberal government and released at Mr. Eby's request on Monday recommended a massive overhaul at ICBC, which has a monopoly on car insurance in the province, to avoid the need for a steep rate hike over the next two years to balance the agency's books.

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"A 30-per-cent rate increase for British Columbians is not on for our new government, and we will be addressing this," Mr. Eby told reporters on Monday afternoon, hours before the release of his mandate letter from Premier John Horgan, which called on him to conduct a comprehensive operations review of ICBC.

The new report by Ernst & Young points to a 23-per-cent spike in the number of car crashes over the past three years and a jump in the cost of vehicle repairs and injury claims as two of the main reasons for growing financial pressure at the Crown corporation. It also says B.C. drivers have been sheltered for years from necessary rate increases by previous government intervention, which used profit from the agency's optional coverage to keep basic premiums artificially low for years.

"The BC Liberals have been using ICBC as a bank machine, bringing money out of the corporation to claim better finances than are clearly the case," Mr. Eby said.

Basic premiums in B.C. rose 11 per cent ($130) from 2011 to 2015, and today drivers in the province pay the second-highest rates in Canada, according to the report.

But those prices still do not cover the cost of insuring B.C.'s drivers, and ICBC faces a "significant and growing gap of $560-million today between the premiums collected under the basic product and claims costs," the report stated.

"This report illustrates a situation that must have been apparent to the board and to the government of the previous administration; for some reason they failed to act to address these growing cost pressures," Mr. Eby said. "We will act."

The report suggests solutions that include capping payments for pain and suffering, making high-risk drivers pay more and bringing back speed cameras, commonly referred to as photo radar. Mr. Eby said those options are on the table except for photo radar, which created a wide public backlash when the New Democrats brought it in the previous time they were in power.

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Mr. Eby also ruled out bringing B.C. in line with the rest of the provinces by implementing a hybrid model of coverage that involves no-fault insurance, which directs a person involved in an accident to deal with their own insurance company regardless of who is at fault.

He said the province's model – in which drivers sue each other for damages – served B.C. well for a long time and only "in the last two years it's proven to be unsustainable."

After Mr. Eby's news conference, Liberal MLA Andrew Wilkinson, who was briefly attorney-general, told reporters the NDP had failed to outline a concrete plan to help ICBC. "It's time for the NDP to show some competence in office and tell us what they're going to do," he said of the government, which was sworn in last week.

Mr. Wilkinson did not respond when asked what responsibility the Liberals accepted for their role in ICBC's financial circumstances.

With a report from the Canadian Press

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